The European Union made an abrupt U-turn away from its stringent AI regulations. Meta promptly adjusted to the loosening restrictions.
What’s new: Henna Virkkunen, the EU’s head of digital policy, said the organization would ease rules and requirements to support Europe’s competitiveness in AI.
How it works: Adopted last year, the EU’s AI Act provides a comprehensive framework for regulating AI that aims to reduce purported risks by banning certain applications, restricting others, and requiring extensive documentation of development efforts. The law is set to take effect in August, empowering various regulatory bodies to formulate detailed rules. However, in recent months, the EU has faced increasing pressure from the U.S. government and large AI companies to reduce the regulatory burden.
- Virkkunen announced the EU would withdraw a provision that allowed citizens to sue AI companies for damages caused by their systems and required extensive reporting and disclosure.
- She advocated adjusting the regulations to make the EU more competitive and independent. “When we want to boost investments in AI, we have to make sure that we have an environment that is faster and simpler than the European Union is right now,” he said.
- Critics accused regulators of defanging the AI Act to appease U.S. AI companies and the Trump administration, which has argued that the AI Act is an excessive barrier to innovation. Virkkunen denied bowing to U.S. pressure.
- Meta responded to the shifting regulatory environment by resuming training its models on European data. Last year, the company stopped releasing multimodal models in Europe after EU regulators warned that training models on data from European users of Facebook, Instagram, and other Meta properties potentially violated privacy laws.
Behind the news: In drafting the AI Act, the EU aspired to a comprehensive, specific set of regulations. However, not all European lawmakers agreed that rules were needed. Virkkunen’s supporters noted that existing laws already allowed consumers to file claims against AI companies. Meanwhile, some policymakers have become less worried about AI than they were during the early drafting of the AI Act.
Why it matters: It’s unlikely that all nations – or even states within nations – will ever agree fully on rules and regulations that govern AI companies that do business within their borders, or protections from flaws such as model bias. But AI companies including Meta, OpenAI, and others argue that a more uniform regulatory environment will make it easier to serve users worldwide.
We’re thinking: The EU overreached with the AI Act. Fortunately, the legislation provides enough flexibility to pull back. Clearer rules will help European teams innovate and European and international companies better serve EU citizens.